MOBILINK 1

SubsidiaryType

Orascom Telecom EgyptParent Company:

1994Time of launch

Prepaid: JazzPostpaid: indigo

WiMax: Mobilink InfinityMobilink PCO

Main products

mn 799936Rs2007-2008 Revenue

%36Market share 2008-200728,315,076Number of Subscribers

(Jan 2009)

GSM/GPRS and EDGE technologyTechnology

1 http://mobilinkgsm.com/about/index.php

Mobilink GSM (PMCL) has become the market leader both in terms of growth as well as having the largest customer subscriber base in Pakistan - a base of over 28 million and growing.

It was the first cellular service provider to operate on a 100% digital GSM technology in Pakistan.

Mobilink places high importance to its coverage, covering 10,000+ cities and towns nationwide as well as over 130 countries on international roaming service.

The indigo connection provides state of the art facilities that let the customers conduct business on the go. With services likeo Blackberry

o Internet Browsing

o Fax

o E-Mail

o Stock Watch

o On-Call Services

Indigo makes sure that its customers can make timely and informed business decisions, always.

In addition to providing advanced voice communication services that makes the lives of millions that much easy, it also offers a host of value-added-services to its customers.

o Mobisafe

o Stock watch

o Call Conference

o Mobilink Connect card

o Fax/ Mail

o PIA Reservations

o PSO Cards

2

DEREGULATION IMPACT

Cellular Subscribers Growth3

CELLULAR SUBSCRIBERS

Mobilink Ufone Zong Instaphone Telenor Warid TotalGrowth Rate %

2000 114,272 80,221 112,000 306,493 15.39

2001 309,272 116,711 96,623 220,000 742,606 142.29

2002 800,000 350,000 218,536 330,000 1,698,536 128.73

2 PAKISTAN TELECOMMUNICATION REPORT, Q1 2008, published by BMI3 http://www.pta.gov.pk/index.php?option=com_content&task=view&id=650&Itemid=603

2003 1,115,000 550,000 319,400 420,000 2,404,400 41.56

2004 3,215,989 801,160 470,021 535,738 5,022,908 108.90

2005 7,469,085 2,579,103 924,486 454,147 835,727 508,655 12,771,203 154.26

2006 17,205,555 7,487,005 1,040,503 336,696 3,573,660 4,863,138 34,506,557 170.2

2007 26,466,451 14,014,044 1,024,563 333,081 10,701,332 10,620,386 63,159,857 80.70

2008 32,032,363 18,100,440 3,950,758 351,135* 18,125,189 15,489,858 88,019,812 39.4

July-2008 32,056,336 18,368,074 4,446,024 351,135 18,329,428 15,774,299 89,325,296 1.4

Aug-2008 31,578,241 18,600,511 4,803,058 321,134 18,316,157 15,944,559 89,563,660 0.3

Sep-2008 31,359,049 18,801,402 5,092,476 321,134 18,472,445 16,157,778 90,204,284 0.7

Oct-2008 30,882,528 18,978,138 5,297,610 321,134 18,634,249 16,411,898 90,525,557 0.4

Nov-2008 30,055,187 19,100,291 5,398,823 321,134 18,875,127 16,656,589 90,407,151 -0.1

Dec-2008 28,479,600 19,301,180 5,503,274 321,134 19,387,956 16,914,054 89,907,198 -0.6

Cellular Mobile GST/CED Collection

Mobilink is contributing about one fourth of the total activation tax, which has market share in subscribers over 37%.

During the year 2007-08, cellular mobile companies deposited over Rs. 23.2 billion, which is 33% higher than the last year.

Mobilink has deposited over Rs. 10.1 billion in this head, which is 44% of total WHT deposited to FBR in 2007-08.

Mobilink, the leading mobile operator, is losing its significant Market Power rapidly. Its share has declined from 41% in 2006-2007 to 36% in 2007-2008.

Mobilink Mobilink has reduced its tariffs for different packages and has introduced new

packages like Jazz One, in which callers can call at very attractive rates. Off-net rates have also been reduced on Jazz Budget, Jazz Octane and Jazz Ladies

First packages. Moreover, Mobilink introduced “Apna Jazz Connection ON Karein” promotion which

was specifically made for those who did not get the chance to experience lowered Jazz tariffs. Mobilink posted an unconditional Rs. 30 worth of balance for those who did not used Jazz connection since March 15th

For SMS , Mobilink has offered three different SMS packages (only from Mobilink to Mobilink) to its prepaid customers where it has offered unlimited SMS’s for one month for Rs. 100, 500 SMS’s in 15 days for Rs. 50 and 100 SMS’s for Rs. 15 in 7 days.

Mobilink also introduced Club Red promot ion for i t s subscribers who wanted redcarpet treatment. Under this offer, Jazz subscribers who crossed the monthly usage threshold of Rs. 1,000 got 50% discount on all calls to Mobilink numbers for the remaining days of the month.

Cellular tariffs prepaid

  Mobilink Telenor Ufone CMPak

  Jazz One^ Talkshawk A-1 Uwon^ 8^ Aanay*

  1st Minute2nd Minute onwards

1st Minute2nd Minute onwards

1st Minute onwards

1st Minute2nd Minute onwards

Billing Pulse 1-Minute 1-Minute 1-Minute 30-Second

Local & Long distance Calls to Same Network

Airtime 1.00 1.00 1.00 1.00 1.00 1.50 1.50

Call Setup Fee 0.40 0.00 0.40 0.00 0.00 0.00 0.00

21% GST 0.29 0.21 0.29 0.21 0.21 0.32 0.32

Total 1.69 1.21 1.69 1.21 1.21 1.82 1.82

Local & Long distance Calls to Fixed-line Network

Airtime 1.60 1.60 1.40 1.40 1.60 1.00 1.00

Call Setup Fee 0.40 0.00 0.40 0.00 0.00 0.40 0.00

21% GST 0.42 0.34 0.38 0.29 0.34 0.29 0.21

Total 2.42 1.94 2.18 1.69 1.94 1.69 1.21

Local & Long distance Calls to Other Cellular Network

Airtime 1.60 1.60 1.40 1.40 1.60 1.00 1.00

Call Setup Fee 0.40 0.00 0.40 0.00 0.00 0.40 0.00

21% GST 0.42 0.34 0.38 0.29 0.34 0.29 0.21

Total 2.42 1.94 2.18 1.69 1.94 1.69 1.21

^ Limited Time Offer

* Normal Off-net tariffs are Rs.0.75 per 30 second (Excld. 21% GST)

Mobilink:

Mobilink GSM is a subsidiary of Orascom Telecom and is the market leader in cellular service providers in Pakistan.

Orascom Telecom was established in 1998 and has grown to become a major player in the telecommunication market in the world.  Orascom Telecom is one of the strongest established players in the Middle East, Africa and Pakistan .

Orascom Telecom subscriber number reached over 20 million subscribers as of June, 2005. 4

Orascom Telecom's operation in Pakistan, Mobilink, started its operations in 1994, and until early 2001, had a market share of 40%. In April 2001, Orascom took over management control of the company and as of June, 2005; Mobilink catered to more than 7 million subscribers, having a market share of approximately 61% of the total mobile subscriber base in Pakistan.

Mobilink GSM has so far invested $2 billion in Pakistan and in the coming years it is planning to further invest $500 million.5

Orascom Telecom has positioned diverse GSM operations, with various GSM support and Internet operations. One of Orascom Telecom's main strategy is to create its own non-GSM subsidiaries to act as a support for its regional GSM operations. Orascom has done this by dedicating financial, technical, and management resources for its subsidiaries. This includes various value added and internet services.

Orascom nearly has 11,000 employees working under its banner.

Vision

To be the leading Telecommunication Services Provider in Pakistan by offering innovative Communication solutions for our Customers while exceeding Shareholder value & Employee Expectations.

Mobilink..reshaping lives!

Mobilink GSM has customer a base of over 30 million and is still growing at a phenomenal pace. It is the first cellular service provider to operate on a 100% digital GSM technology in Pakistan and also provides state-of-the-art communication solutions to its customers.

4 www.mobilinkgsm.com

5 http://www.dailytimes.com.pk/default.asp?page=2007%5C11%5C16%5Cstory_16-11-2007_pg5_9

Mobilink places high importance to its coverage. It has a coverage network that covers its consumer base in 7000+ cities and towns nationwide as well as over 120 countries on international roaming service.

The company caters to a large range of consumers from businessmen to multinationals to the individual customer.

Achievements 6

ISO 9002 Quality Management System Certification for Billing, Engineering Departments and CS Contact Center

Implementation of a full Intelligent Network (IN) platform from Siemens for the Prepaid platform

Largest Call Center in Pakistan, which is there to assist the customers 24 hours

Only cellular service in Pakistan to provide coverage on the M2 motorway Bilateral roaming in over 120 countries around the world with true

international roaming with over 300 operators across the globe First mobile operator in Pakistan to offer extensive GPRS Roaming and

BlackBerry Roaming services MOBILINK GSM's Short Message Service Center allows Vehicle

Tracking and Fleet Management services that are being provided by Trakker (Pvt.) Ltd., under the brand name of C-Track, a company licensed by Pakistan Telecom Authority (PTA). Trakker currently operates from Karachi but can provide these facilities at all those locations where GSM coverage is available.

During the last 13-14 years, Mobilink has set up one of the largest cellular networks in the country. This has involved an investment of more than US$ 1 Billion. The company currently has 66 Switches and more than 6,300 cell sites and the number keeps growing at a rapid pace. It also have deployed around 5,000 km of optical cable.

Years of Business 13

Cities 7000+

Investment USD 1 Billion+

Switches 66

6 www.mobilinkgsm.com

Cell Sites 6,300

Optical Cable Deployment 5,000 KM

Switches Nokia-Siemens, Alcatel, Huawei

Radio Base Stations Motorola and Alcatel.

Intelligent Networks Siemens

Microwave Equipment NEC and Alcatel

Operating Frequency 900/1800 MHz

SMSC Logica CMG

7

Mobilink believes in playing an active role in supporting the community and social development of Pakistan.

It engages in community friendly practices like

Mobilink Foundation Wheel chair access at office Recycling of billboard skins Lady health worker pilot project

New Offering By Mobilink

Mobilink offers the new Mobilink PCO, a special offer for consumers at the grass root level to communicate. Mobilink PCO is basically a fixed wireless phone with PCO functions. It has two LCD screens displaying call costs and duration. It offers unmatched coverage and portability. All the user has to do is load a prepaid jazz card and he is ready to communicate, enjoying exceptional mobilink services and after sale services.

7 www.mobilinkgsm.com

Mobilink-

The company has been operating in Pakistan since 1994. the revenues of Mobilink grew at a proportional pace and it continues to be the leading contributor to total revenue due to it sheer size. Mobilink enjoys almost 50% of the total revenue, occupying the highest market share. Subscriber share was around 42%, totaling 24.6 million at the end of June 2007.

Mobile Telecom has also selected DragonWave’s Horizon Compact IP backhaul product to provide 270 wireless backhaul links for a new nationwide WiMAX Network in Pakistan with Mobilink. Initial rollout will begin in the cities of Islamabad, Karachi and Lahore.

Mobilink is currently deploying a very large, 8,500 km fiber optic network in Pakistan which will act as the backbone for its traffic by the end of 2008.8

The mobile service industry took a skyrocketing advance towards its growth and becoming a substantial contribution towards Pakistan’s economy. 2004 marked the beginning of price wars between existing companies, and 2005 as the arrival of new players into the market. As a result, the mobile service industry witnessed its biggest boom since its inception.

New players, Warid and Telenor are now busy working on their extensive infrastructure plans in order to provide better and widespread nationwide coverage, whereas Mobilink for a long time, has maintained an edge over all competitors in terms of coverage.

8 http://www.pakistantimes.net/2008/04/24/national1.htm

Reasons for introducing new players in the market are:

High demand Low teledensity High tarrifs Low coverage

Question/Answer session:

1. What sets you apart from the other service providers?2. What is the USP of your particular firm?

MOBILINK

Mobilink was the pioneer for GSM (Global system mobile communication) technology in Pakistan. Insta initially conquered the market with AMPS (Advanced Mobile Phone Systems) technology, and then later Paktel, but Mobilink was the first to introduce GSM technology in the market.This technology was introduced alongside a significant edge over AMPS technology, the most important one being secure connectivity with virtually no capacity of signal leakage, and the other being superior voice clarity.Furthermore, Mobilink boasts a great market share of the industry; out of the total 75 million people who use cellular technology, 30 million use Mobilink. It focuses strongly on its core market, i.e the business community and provides VAS (Value Added Services), which includes Mobile TV, GPRS Connectivity, Blackberry Connectivity Services and 555 Infotainment Services (sports, health, music, headlines, etc.)

WARID

Warid brought in a lot of expertise and foreign exchange of $1.5 billion. They have a telecom license of $290 million. They represent the royal family of UAE which is a $10 billion group. They are different because they believe in the youth.

In terms of network, Warid has 3000 towers already and has 200 towers erected each month. It’s been two and a half year since it started as a company here and it already holds the third position in the telecommunication sector. And, they are striving to achieve the 2nd position by the end of this year. Singtel owns 30% shares of Warid in Pakistan. This is an advantage to Warid since Singtel is the second largest telecom company in Asia.

WATEEN

What makes Wateen unique is that it is the only company in Pakistan with Wimax. This is currently operational in 22 cities. Wimax is used for voice, data and video, also known as the Triple Play Service. Wateen focuses on quality of infrastructure and of its employees which in turn will determine the quality of service. According to the General Manager Corporate Solutions Wateen, “Our unique point is that we are there a carrier service for all solutions”.

PTCL

PTCL enjoys an established name for itself. It was in existence since the conception of the country, first known as the Pakistan Telegraph and Post and later known as the more recent PTCL in 1980. PTCL will always enjoy a unique position in the market as it has been the oldest service provider. PTCL enjoys market leadership in Local loop, Wireless local loop (WLL) and Fixed telephony. PTCL enjoys sound and well established infrastructure like no other firm in the market, having the best engineers and technical know how in the market. It offers new services on its own infrastructure and is not dependant on other firms for its services. When post 2002, new entrants in the form of mobile companies came into the market, they used the infrastructure of PTCL to establish themselves into the market.

3. How important is innovation in the telecom industry?

MOBILINK

We are what we are as a result of taking the initiative and innovating.

WARID

For Warid, innovation is the top most priority. Warid innovates keeping customer satisfaction in mind. Innovation includes pushmail, blackberry solution and number portability which can work on any smart phone.

WATEEN

Technology is so vital to the Telecom industry that a firm will die without it. One has to constantly innovate in product and service. The challenge now is to come up with value added services.

The telecom arena is changing. Video calling, gaming and internet surfing via mobile will be big. One will be able to sit at IBA and know what is happening at home. Distance education will be possible. All scholarly lectures will be available online.

PTCL

Innovation is extremely important especially after the deregulation of the industry. This is particularly important for the cellular service providers as they have intense competition within that niche of the market. For landline, and as far as PTCL is concerned, the company enjoys a major chunk of the market and hence the benefits attached. However, in the highly volatile and proactive market of today even PTCL is revamping itself by coming up with better and attractive services as you may have seen in terms of better advertising and new packages like the ‘Pakistan Package’

4. You have made massive investments in the market. By when do you expect to recover your costs?

MOBILINK

No firm in the Telecom industry can survive without investment. Investment is a regular feature regardless of cost. Its benefits are much greater always.

WARID

Warid has made massive investments and expects to recover its costs in four to five years.

WATEEN

Wateen expects to recover its investment costs in about 5 to 7 years. The problem is it cannot stop investing because it is necessary in order to remain competitive and to grow. Currently Wateen has not even touched the rural areas.

PTCL

The PTCL’s communication network is being completely revamped as the company is investing a huge amount on this effort. The upgraded network will be much superior to the old one, as it will not only reduce the frequency of faults but even the duration in which they are rectified. The real beneficiaries of this investment in infrastructure by the PTCL will be its customers who will experience enhanced voice quality and swift repairs of any problems they may face.

5. Are your technological solutions based locally, or are they outsourced? Why?

MOBILINK

With Orascom Telecom being our parent company, we were able to acquire state-of-the-art equipment, all of which is imported. However, our technical staff is trained and based locally. Mobilink is equipped with a QAD (Quality Assurance Department) which is responsible for maintaining quality in terms of infrastructure and technology.

WARID

Singtel brought equity because Pakistan is too young in technology. Warid’s technological solutions are locally based and Ericsson, being Warid’s partner, also provides some of the technological support.

Previously, Warid was in partnership with Motorola, but there were a lot of delays because of too many commitments. Warid switched to Ericsson which is giving better solutions.

WATEEN

Wateen owns its infrastructure like all other firms. Technology is outsourced but it’s operated locally.

On the other hand, Telenor outsources its Call Centres. It’s the only company which does that.

PTCL

PTCL has a well developed infrastructural base that was established with the conception of the company. It does not rely on other companies or foreign establishments for its technology. However it does benefit from the technical know how and expertise of Etisalat which has a 26% stake in PTCL and charges it a fee of 3.5% of revenue for this.

6. What are the growth opportunities for new entrants who want to be a part of the market?

MOBILINK

There are immense growth opportunites. Mobilink is an established player but Warid for example, is a new player and is already one of the top companies. This just proves the existence of opportunities in the Telecom arena. There is a lot of potential for new players into the market. Healthy competition further contributes to market activity and innovations.

WARID

There are lots of growth opportunities for new entrants. Pakistan has seen an increasing emergence of new players in the Telecommunication arena.

WATEEN

There are plenty of growth opportunities in the Telecom industry. However there is not much space for large operators unless they come with massive investments like China mobile.

PTCL

The market is open for new entrants and the prospects look pretty bright. In the near future it is expected that 2-3 new players will be entering the market. However, think these will be concentrating on providing cellular services and exploring the markets of data.

7. What technological barriers will you have to face when undergoing or wanting to undergo expansion?

MOBILINK

Just the cost factor.

WARID

No barriers. Warid has all it takes to withstand any further expansion.

WATEEN

Wateen is using between 3G and 4G technology which is totally digital and advanced. It greatly facilitates the flow of data. Convergence is taking place between voice and data and this requires 3G and 3.5G technology which Wateen already has. However it is very costly especially for a new firm like Wateen.

Mobilink on the other hand, is not very good with data transmission but carries voice efficiently. For convergence, Mobilink will have to invest in this technology.

PTCL

(none)

8. How will the increasing emergence of new players in the market affect the sales of your particular firm?

MOBILINK

Well the emergence of new players has increased competition for Mobilink who has to be on the look out to ensure it is not loosing its customers.

WARID

Entrance of new players will not affect Warid much because Warid has already created a strong customer base.

WATEEN

How new players affect Wateen will depend on their product positioning and strategy. For example, the emergence of Wateen has caused pain to ISP providers but not to voice service providers.

PTCL

It is true that with the increasing liberalization and new players entering the market, the level of competition has increased dramatically. However, PTCL will not be that affected by this as fortunately for them, they enjoy significant power in the market. This competition will mainly be among the cellular service providers.

9. With China Mobile entering the market, how do you plan to grow in an arena with such powerful players?

MOBILINK

The arrival of China Mobile into the market would be a chance for competition; with our stable position in the market, it is not a threat as such. Any strategies or plans that they may have, we will always have counter-plans ready to come into play.

WARID

Functioning in the Telecom industry is no smooth sailing. Warid plans on retaining what it has already. According to Asad Reza, China mobile will win in some areas but will loose out in some. So its entrance into the market is not that much a matter of concern for Warid.

WATEEN

The entry of Chine mobile will not affect Wateen because China mobile will only provide voice communication. It will have the largest infrastructure in the next two years. By June 2009, China mobile will have 7000 towers. Mobilink is expanding too.

PTCL

China mobile’s emergence will not affect PTCL’s market share as its market focus is different. In fact, it is encouraging for the industry as PTCL will get foreign interest in the local market.

10. Is advertising the main way of attracting customers? Or is it other factors like quality of service, price, and competitive packages?

MOBILINK

Both are important. There is no one best way of winning and maintaining customers. Customers want value for money. And that’s what Mobilink aims for.

WARID

Advertising is a permanent feature. Warid uses it for image building, introduction of new products and awareness. This is done through signboards, billboards, sponsorship of programs and campaigns organized at schools/colleges.

WATEEN

Advertising is the most used medium to attract customers who are young (95%). Other than advertising, Wateen follows other campaigns such as concerts (e.g. Ali Zafar has a Rs.350 million contract with Telenor), sports sponsorships (golf, cricket etc) and even Kabaddi championships in the rural areas. On the corporate side most promotion is below the line.

Pricing is always a challenge. ISP collapsed because they started competing on price. The problem for such firms lies in the fact that they use average revenue per user (RPU) as a measure. A better measure is margin per user (MPU). RPU just shows revenue per user. By the time this goes below $2, the firms will go bankrupt.

Emphasis should be on value addition and not on prices.

.

PTCL

No doubt, advertising is an important way of attracting customers but in PTCL’s opinion this is more vital for the new comers. Other ways of marketing are more important like proper and timely strategy making and implementation along with developing new packages that offer quality services , knowing when and how to diversify and being alert and proactive towards changing market trends and behavior.

11. Diversification is a hot topic. How do you plan on making use of this?

MOBILINK

Mobilink has no plans of diversification. However, it is maintaining its market share by offering new services. One of its unique facilities include Indigo Club (an exclusive club usable by Indigo customers who reach a specified billing amount) which is spread all over Pakistan into 30-35 camps.

WARID

Diversification is healthy to survive in this industry. Warid has plans to diversify in the future.

WATEEN

Convergence. In the telecom industry, one has to be a data-voice-video provider to survive. There’s so much integration taking place that very soon telecom, IT and media industries will combine to become the infotainment industry.

PTCL

(none)

12. Today each individual possesses more than one connection. How does your firm make sure that you are an individual’s primary connection?

MOBILINK

Loyalty. Mobilink entered the market with excellent coverage throughout Pakistan on its way to further expand, and a promise to deliver. Customers who bought Mobilink packages in its initial stages in Pakistan prefer not to part with, and still use their old connections. We consider this loyalty to be our USP.

WARID

Warid does direct selling as well as corporate selling. According to Asad Reza, when people give him their visiting cards, he checks to see a 0321 or a 0322. Warid also gives out free Sims with the aim of increasing its customer base.

WATEEN

(Does not apply)

PTCL

Cellular networking and landlines are two separate segments of the market, PTCL enjoys the highest market share, and that too by a great margin in the landline department. So the prospect of our customers having more than one sim is not a matter of concern. Yes, as far as Ufone is concerned, we are very optimistic about its future and its profitability is also increasing. We are concentrating on active promotional campaigns, stressing on the youth as well as the local masses. We are sure the results will and already have started showing in the near future.

(note: this has not been proved yet according to our own research, as PTCL is losing its popularity)

13) To what extent does PTA have control over your industry?

MOBILINK

The PTA has some limitations over Mobilink in terms of pricing, but not in terms of infrastructure or our services, because initially Mobilink used PTCLs landlines, but after its reliability began declining and usage policies began uprooting, Mobilink initiated construction, development and expansion of its own completely independent infrastructure, including fiber optics technology.

WARID

PTA is a governing body that sets rules for the benefit of the telecom industry. In return, the firms are supposed to adhere to them, the PTA provides the industry with consultation and surveys. It plays a proactive role. All the telecom firms regularly meet up with the PTA and give their input. “It’s a healthy glove and hand relationship”.

WATEEN

PTA is a positive regulator. It develops policies that are encouraging for the industry. It provides an enabling environment to encourage operators to grow and make revenue.

PTA keeps an eye on pricing. For example is got rid of the once operational charges on incoming calls. This was a relief for the customers. On the other hand, there’s no forum for consumer protection in the telecom industry. For instance if you buy a Warid card and it is misused by someone else, there is no one you can go and complain to.

PTCL

The PTA basically acts as a regulatory body over the industry. It overlooks the working of the different operating firms protecting the customers as well as facilitating the firms.

14) How have you segmented your market? What is the major chunk that you focus on, that is, prepaid or postpaid?

MOBILINK

Mobilinks target market is segmented into two main groups:• Youth• CorporatesMobilink pays attention to the separate needs of its two market segments. The youth (Jazz Prepaid) packages are more affordable and designed in a way that keeps in mind the markets limited budget. Hence, the introduction of services such as Jazz Budget, Jazz Share and Free SMS packages.The other segment (Indigo Postpaid) is loaded with core business services for corporate, like GPRS, Mobile TV, News Alerts, and obviously, top-notch calling packages.Furthermore, mobilink is culture-oriented and focuses on quality for all its customers regardless of the customer category they fall into.

WARID

Warid has segmented its market into prepaid and postpaid. Postpaid majorly caters to the corporate sector. Prepaid is very popular among the youth even though Warid has the largest postpaid cellular base in Pakistan.

WATEEN

Our consumers are divided into 3 main categories namely: parent, child and walk-in customer (which could be anyone).

Wateen separately focuses on the corporate side, SME side e.g. real estates, and solo side which includes architects and lawyers.

PTCL

In terms of services, PTCL offers data as well as voice. Its basic concentration as well as majority of our revenue comes from fixed/landlines is this service has been solely provided by PTCL for a long time. Other companies like ‘Go’ though are present but at the moment do not pose a threat to us. Then there is Ufone, a cellular service that has shown drastic improvement over the years. It also offer data internet solutions though this segment of the market has to be worked on more thoroughly in the future. In terms of its consumer base, it caters to each and every segment of the population from the average citizen to all the government connections handled by the National Trade and Communication Corporation.

15) What is your pricing mechanism? What are the factors that lead to the fixing of specific tariffs? What is the process involved in doing so?

MOBILINK

When any new campaign is introduced, its format is laid out on customer needs, customer category (Jazz or Indigo) and customer affordability. Mobilinks pricing does not revolve around cut-throat competition, but in fact the availability of quality services and reliability.

WARID

Warid believes in transparency in billing. In prepaid, every time a customer makes a call or sends a message, he gets a delivery report informing him about the cost of his call/message. This way the customer is kept constantly informed about his remaining credit. There are different packages for different segments. Each package has a different monthly line rent and free minutes. Besides that there are different rates for friends and family, Warid to Warid, Warid to landline, and Warid to other networks. This enables the customer to select a tariff plan according to his/her needs.

WATEEN

Wateen has the lowest tariff on internet. Tariff on voice is also relatively low. It is at 40 paisa per minute (Rs.2 for 5 minutes) whereas PTCL charges Rs.2 the minute the phone is received.

PTCL

The market is open. It decides the prices for itself just like other commodities in the market. Some luck factor is also involved, some companies who are able to present a new package or service to the market before others can enjoy better rates for some time. But this is usually short lived as others will catch up sooner or later so every firm is observant of prices of other companies. Overall, PTCL does not indulge in a price war, just cautious pricing.

16) As compared to other countries, do you think the telecom industry in Pakistan is up to the standard?

WARID

The telecom industry in Pakistan is in its initial stages. The neighbors are far ahead.

WATEEN

Pakistan’s Telecom industry is quite well developed since it has a wide infrastructure. It is twice as better as India where the pricing mechanism is bad. It is also better than Sri Lanka, Bangladesh. It is even better than the United States in terms of coverage. However, we cannot compare our telecom industry with Saudi Arabia.

PTCL

Yes, definitely. Initially back in the 1970’s and 80’s Pakistan was among the top cable and wireless service providers. Even today our telecom industry is competitive and is fit to compete with those of other countries, Telecom outsourcing has a huge potential for Pakistani technology industry as well. Currently there is no large IT company in Pakistan which competes globally for telecom outsourcing projects. This is an arena that should be explored.

17) With the rapidly increasing customer base, what problems could the telecom industry face and does it have sufficient resources to handle them?

WARID

Warid is focusing on developing the rural areas for example business centers in Hyderabad and Sukkur. Other than that Warid has sufficient resources to handle the increasing customer base.

WATEEN

At the moment, only one-third of Pakistan uses Sims. Also, one-third of the population lives in urban areas. Hence this means most of the rural areas are yet to be catered to.

The government has set up the Universal Service Fund (USF). All firms are required to contribute a certain percentage to the fund and this is used for expanding the telecom network to the rural areas. By June 2010, mobile networks should reach every nook and corner of Pakistan. Wateen is well-prepared for this but this requires constant improvisation of infrastructure.

The Telecom industry has never seen a downward growth trend.

PTCL

(None)

18) How has the socio-political situation in our country affected the telecom industry?

MOBILINK

The socio-political instability of the country does not affect Mobilink’s reliability and coverage. Regardless of the level of network saturation, the quality of service remains the same.

WARID

Even in chaotic city situations, Warid’s functioning is not affected. According to Asad Reza, Warid has faith in this country. In fact, on a lighter note, he said that whenever there’s a problem in the city, our business goes up as people make more calls. There is congestion in the lines but Warid never stops working.

WATEEN

The political and social turmoil in Pakistan has not affected Wateen. However one problem is that foreign investment in the Telecom industry will shy away with the exception of China Mobile.

PTCL

It hasn’t really affected the industry. People will still want to commute where ever they are

19) Do you feel the telecom industry has reached saturation? Or is there more scope for creativity?

WARID

There is a lot of scope for creativity. Its has not reached saturation

WATEEN

The telecom industry has not reached saturation. 70% of the population is yet to be served

PTCL

No, not at all. The Telecom industry is far way from saturation. There is still a long way to go. In fact there has been foreign interest in the market, companies are coming up with better services and products. There is potential for prospective firms.

20) What sort of an attitude does the government show towards the industry? What are its policies? (supportive/unsupportive?)

MOBILINK

The Government is very encouraging of new players entering the market in terms of licensing, and has supportive policies towards existing companies.

WARID

The government has a caring attitude towards multinationals. It is cooperative.

WATEEN

The government’s attitude towards the Telecom industry has been very supportive. Telecom makes up 5% of the GDP.

PTCL

Well the attitude is pretty much that of a facilitator. To say that government has a spot towards PTCL would be inaccurate. Each company that is operating is treated the same way. A rule or tariff that is subjected to Warid will also be subjected to Mobilink or PTCL. It’s pretty much a fair game.

21) What is the most important factor for the success of a firm in the telecom sector?

MOBILINK

Continuous improvement and innovation

WARID

For a firm in the Telecommunication industry, customer service and technological advancement are the most important factors guaranteeing success.

WATEEN

The most important success factor for any firm in the Telecom Industry is the people who provide the service. Second most important factor is the price of the handset i.e. prices of phones, modems, TVs.

PTCL

Innovation and timely delivery of services are very important.

22. What is the projected growth of the cellular industry in the next

 

2 years 5 years 10 years

And why?

MOBILINK

projected growth 2 years:Expansion of coverage and penetration into existing markets.5-10 years:Maintain position as market leaders.FUTURE PLANS:Mobilink plans on collaborating with Allied Bank or UBL to initiate and develop mobile-banking services for its customers.No international expansion plans so far.

WARID

By the end of this year, Warid expects to be number 2 in the telecom industry. In ten years, it sees itself as number 1.

It’s a fast moving industry. There are new things coming up all the time. It’s all about technological warfare for example you can even do your banking from your phone.

WATEEN

Growth of the Telecom industry is expected to be 12% to 15 % in the next 3 years. PTCL might not grow much. For Wateen, growth is expected to be 45%.

PTCL

The industry expects a robust growth of 11-13% in the next 3-5 years and this trend is expected to maintain itself over the coming years